Helmsman took a large placement recently at 2.18c and underwrote the rights issue. Underwriting a rights issue is a convenient way for an investor to get effective control of a company without making a full takeover bid. A bid is normally required if a company exceeds 20%, but not if it occurs from underwriting. If none of we suckers who own shares in QRS took up our rights entitlement, Helmsman would have 41.5% of the company (section 5.5 of the rights issue prospectus). Helmsman may have been pleased to see the QRS share price weaken sharply in the week prececeding the rights issue close, as a weak share price would increase its stake towards effective control by discouraging rights subscriptions. The less we suckers subscribed for, the more they got at the dirt cheap issue price. QRS appears to me to be a company that could prosper if new management came in. Helmsman will soon have a very influential stake in QRS so may have the leverage to make the necessary changes. Here's hoping.
QRS Price at posting:
2.2¢ Sentiment: Hold Disclosure: Held
